Agency sees stabilisation in Barcelona property market

The Barcelona-area property market has “stabilised” with foreigner buyers boosting activity, according to a new report by Amat Immobiliaris, a Barcelona-based real-estate firm.

Overall sales activity increased in 2013, after a slow start, Amat reports. In Barcelona’s central districts, prices were virtually unchanged since 2012, leading the agency to conclude “prices have been bottoming out for two years.”

In the first half of 2013, the market was “virtually immobilised” by a 10 per cent increase in VAT for new housing, but the effect was “absorbed” by the second half of 2013, the firm reports.

In the city of Barcelona, 75 percent of the deals involved new housing, according to the agency.

“This is largely explained by the volume of sales made to foreigners, who initially prefer to buy new buildings over second hand,” Amat said.

Overall, Amat’s sales to foreigners grew by 40 per cent in 2013 compared to 2012, with almost half of the agency’s sales in the city of Barcelona made by foreigners. Seventy-four per cent of the agency’s deal of more than €500,000 involved foreign customers.

The bulk of the foreign buyers were from Russia and other former Soviet republics, as well as Egypt. The typical Amat buyer is a professional between the ages of 40 and 50 with two children.

The total value of the properties sold by Amat Immobiliaris in 2013 was 20 per cent higher than in 2012, and the number of transactions grew in 2013, the agency said.

Amat data suggests prices may be ready to rise in the city. There has been little new construction in years, suggesting demand – especially from foreign buyers – could start driving up prices.

“As in recent years the entry of new housing on the market has fallen drastically; in some areas the new housing stock has been virtually used up,” Amat reports.

A few weeks ago crowds lined up in Barcelona to buy new apartments offered by Corp, the local builder.

In the Barcelona rental market, “prices have finally stopped moving and the average fall was 30 per cent from the time the prices reached maximum,” Amat reports. “The rental market has definitely stablised.” The number of rental contracts signed in 2013 was 26 per cent higher than 2012, the agency said.